Reviewing GreenTree Hospitality Group (NYSE:GHG) and BJ’s Restaurants (NASDAQ:BJRI)

GreenTree Hospitality Group (NYSE:GHG) and BJ’s Restaurants (NASDAQ:BJRI) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.

Volatility & Risk

GreenTree Hospitality Group has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500. Comparatively, BJ’s Restaurants has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500.

Earnings & Valuation

This table compares GreenTree Hospitality Group and BJ’s Restaurants”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GreenTree Hospitality Group	$156.92 million	0.63	$23.85 million	$0.05	19.50
BJ’s Restaurants	$1.40 billion	0.85	$48.81 million	$1.87	29.77

BJ’s Restaurants has higher revenue and earnings than GreenTree Hospitality Group. GreenTree Hospitality Group is trading at a lower price-to-earnings ratio than BJ’s Restaurants, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for GreenTree Hospitality Group and BJ’s Restaurants, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GreenTree Hospitality Group	1	0	0	0	1.00
BJ’s Restaurants	1	4	4	0	2.33

BJ’s Restaurants has a consensus target price of $62.00, suggesting a potential upside of 11.37%. Given BJ’s Restaurants’ stronger consensus rating and higher probable upside, analysts plainly believe BJ’s Restaurants is more favorable than GreenTree Hospitality Group.

Insider and Institutional Ownership

8.1% of GreenTree Hospitality Group shares are held by institutional investors. Comparatively, 100.0% of BJ’s Restaurants shares are held by institutional investors. 88.7% of GreenTree Hospitality Group shares are held by insiders. Comparatively, 2.4% of BJ’s Restaurants shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares GreenTree Hospitality Group and BJ’s Restaurants’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GreenTree Hospitality Group	4.14%	2.49%	0.84%
BJ’s Restaurants	3.13%	14.17%	5.49%

Summary

BJ’s Restaurants beats GreenTree Hospitality Group on 12 of the 14 factors compared between the two stocks.

About GreenTree Hospitality Group

GreenTree Hospitality Group Ltd., through its subsidiaries, develops leased-and-operated, and franchised-and-managed hotels under the GreenTree Inns brand in the People's Republic of China. It also engages in investment holding activities; and provision of information technology services. The company was founded in 2004 and is headquartered in Shanghai, the People's Republic of China.

About BJ’s Restaurants

BJ’s Restaurants, Inc. owns and operates casual dining restaurants in the United States. Its restaurants offer pizzas, craft and other beers, appetizers, entrées, pastas, sandwiches, specialty salads, and desserts under brand name Pizookie. The company was formerly known as Chicago Pizza & Brewery, Inc. and changed its name to BJ’s Restaurants, Inc. in August 2004. BJ’s Restaurants, Inc. was founded in 1978 and is based in Huntington Beach, California.